Debt insurance sales ban moves another step closer

This is despite an appeal by Barclays to halt one of its proposed measures.

The watchdog has today begun a consultation to determine how it will implement its proposed three-stage crackdown, which was outlined in January.

The insurance protects borrowers’ credit card or loan payments if they cannot work. Yet it is frequently missold, though consumers are reclaiming cash by the bucketload. Free reclaiming letters are available in the PPI reclaiming guide.

PPI is often expensive, yet you can cut costs by following the tips in the Loan insurance guide.

The CC’s plans include:

A ban on sales by firms for seven days after selling a loan or credit/store card product.

A ban on sales where the premium for the term of a loan is charged upfront and incurs interest. Most lenders have now stopped such sales.

Other measures to improve the information available to consumers to make it easier to compare products.

Barclays has appealed to the Competition Appeal Tribunal (CAT) stating it does not agree with the plans to ban sales for seven days after the sale of a credit product. The appeal hearing is scheduled for September.

CC deputy chairman Peter Davis says: "By continuing with the necessary preparations, we can hit the ground running once the appeal is finalised. If the CAT supports our findings, taking these steps now will help ensure there is no unnecessary delay."

Martin Lewis, MoneySavingExpert.com creator, says: "PPI has probably been the biggest misselling scandal we've seen in the last ten years. I wouldn't be surprised if up to £10 billion pounds-worth has been missold.

"It's therefore no surprise the banks are spitting, kicking and throwing their lawyers in the path of anything that may derail this gravy train.

"So it's gratifying to see the CC standing up and continue the worthy fight to eradicate the nasty and dire selling techniques that have hurt millions.

"However, that only deals with the future problem. We need to look back and anyone with a loan or credit card in the past six years needs to check whether they were sold this insurance and whether it was sold fairly. If not: reclaim, reclaim, reclaim!"

Have your say

This is an open discussion; anyone can post. Comments may be edited, and are only published during the working day. Please report any spam, illegal, offensive, racist, libellous posts (inc username) to fbteam@moneysavingexpert.com.

Related Articles

Holidaymakers with travel insurance policies from at least seven major firms may not be covered for hotel, car hire and other costs if they have to cancel their trip because of Brexit-related flight disruption, MoneySavingExpert.com can reveal. If you're worried, check your policy now - and if you do want cover for disruption, you need to sort it now or risk not being able to get it.

More than a million drivers have paid more than they needed to when applying for or renewing a licence in the past three years because they've done it by post rather than online, MoneySavingExpert.com can reveal

The Times has an upsetting article today about travel insurer TIF. It includes reports such as one of its customers needed to be medically evacuated from the Canaries, and their family (rightly by the sound of it) was deeply unhappy with its treatment

American Express cardholders will now have to wait TWO YEARS after cancelling a card in order to qualify for another welcome bonus – making it much more difficult for those who cycled between cards to earn its introductory offers.

TV streaming service Netflix had admitted showing some people who sign up to Netflix higher prices to understand how much potential customers "value" it - but it says nobody will actually pay the higher price

How this site works

We think it's important you understand the strengths and limitations of the site. We're a journalistic website and aim to provide the best MoneySaving guides, tips, tools and techniques, but can't guarantee to be perfect, so do note you use the information at your own risk and we can't accept liability if things go wrong.

This info does not constitute financial advice, always do your own research on top to ensure it's right for your specific circumstances and remember we focus on rates not service.

We don't as a general policy investigate the solvency of companies mentioned (how likely they are to go bust), but there is a risk any company can struggle and it's rarely made public until it's too late (see the Section 75 guide for protection tips).

Do note, while we always aim to give you accurate product info at the point of publication, unfortunately price and terms of products and deals can always be changed by the provider afterwards, so double check first.

We often link to other websites, but we can't be responsible for their content.

Always remember anyone can post on the MSE forums, so it can be very different from our opinion.

MoneySavingExpert.com is part of the MoneySupermarket Group, but is entirely editorially independent. Its stance of putting consumers first is protected and enshrined in the legally-binding MSE Editorial Code.